Nobody wants cheap (Part 1)

Interesting to read that the Tata Nano is not doing well. Hailed as the next ‘big thing’ in the automotive industry, heaped with industry praise, over 34 patents filed on it’s technology; all for a price tag of only $2400! How could you loose? Tata is loosing, and in a big way. Just over 72,000 units sold in the first year.

Well it seems as though the folks at Tata have for gotten one major factor when it comes to producing and selling cars. Cars are not (all) about numbers. Yes fuel economy, resale value, crash-test safety ratings, and of course price, all play a part. But buying a car is an emotional experience. There’s no difference whether you’re driving your first car in a developing nation, or your twelvth car for your Beverly Hills stable. People want to connect with their vehicle and at the same time they want others to make that connection when they’re seen driving their shiny new toy.

So what’s the problem, are there not enough customers? Hardly. India has an estimated 1.2 billion people. That’s a lot! In fact by 2025, India is anticipated to be the world’s most populous country. Interesting fact, of that 1.2B people, an astounding 65% is below the age of 35! It’s safe to say that a lack of customer base is not the issue.

Perhaps styling is the problem? Actually I rather like the Nano. It’s got a rather cheeky, fun-to-drive look about it. It probably handles like a 67 Oldsmobile Delta 88, but that’s besides the point. Suffice to say that styling is probably not it’s biggest detractor.

The real problem with the Nano is that its cheap. Cheap can be good thing. I want my groceries and gas to be cheap. But I don’t want my car to be cheap. And it seems that most in India feel the same way. Driving a cheap car says something about the owner, and what is says isn’t necessarily very flattering.

If Tata wants the Nano to dominate the roads, as it hoped it would, it needs to solve it’s cheap image.